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KEY

KeyCorp NYSE:KEY Stock Report

Last Price

US$19.21

Market Cap

US$17.9b

7D

8.3%

1Y

-7.8%

Updated

11 Aug, 2022

Data

Company Financials +
KEY fundamental analysis
Snowflake Score
Valuation5/6
Future Growth1/6
Past Performance2/6
Financial Health6/6
Dividends6/6

KEY Stock Overview

KeyCorp operates as the holding company for KeyBank National Association that provides various retail and commercial banking products and services in the United States.

KeyCorp Competitors

Price History & Performance

Summary of all time highs, changes and price drops for KeyCorp
Historical stock prices
Current Share PriceUS$19.21
52 Week HighUS$27.17
52 Week LowUS$16.41
Beta1.32
1 Month Change10.98%
3 Month Change3.17%
1 Year Change-7.78%
3 Year Change20.67%
5 Year Change7.98%
Change since IPO121.12%

Recent News & Updates

Aug 03

KeyCorp: A High-Yielding Bank Trading Down In The Dumps

KeyCorp is a well-run bank that is seeing improving trends and is positioned for loan growth. Management can return significant value to shareholders simply by repurchasing shares at the current price. Shares are attractively valued, pay a solid dividend yield, and have significant upside potential. Banks continue to trade rather cheaply relative to the overall market. This presents patient investors an opportunity to layer capital into this beaten down sector while getting paid an attractive dividend yield. While the larger banks such as JPMorgan Chase (JPM) and Bank of America (BAC) attract a lot of attention, there are regional banks out there that are also value-priced while throwing off an even higher yield. This brings me to KeyCorp (KEY), which is trading materially below its 52-week high of $27 achieved as recently as February of this year. In this article, I highlight what makes KEY an attractive opportunity for income and growth. Why KEY? KeyCorp is a top 20 regional bank in the U.S., with assets of over $170 billion. It's primarily centered around Ohio and New York with a footprint in a total of 16 states. KeyCorp operates as both a community and corporate bank, serving middle-market commercial clients. KeyCorp has undergone drastic changes to its operating model since the Great Financial crisis, when it was forced to cut its dividend due to its foray into higher-risk commercial and construction-related lending in states outside of its footprint. Since then, management has wound down those businesses, and refocused the company towards core corporate banking and capital market services. Morningstar carries a favorable view of KEY's turnaround efforts, as noted in its recent analyst report: KeyCorp’s noninterest income comes primarily from investment banking and asset and trust management services. While noninterest income did not grow substantially for the decade prior to 2019, we think the bank has turned a corner here. We like that KeyCorp is expanding its relatively new credit card income base as well as its own mortgage and capital markets operations. These efforts have largely paid off, and we think fees will be consistently higher from 2020 forward than they were for the previous decade. We expect the bank to continue to remain very competitive in its core middle-market niche, while also building out its focused retail operations. Meanwhile, the bank is executing well amidst the market volatility, with revenue growing by 6% on a sequential basis (1% YoY) during the second quarter. Moreover, it posted strong earnings of $0.54 per share, beating analyst estimates by $0.02, and saw a robust 20.9% return on average tangible common equity. These results were driven by strong loan growth across commercial and consumer businesses and higher interest rates, with net interest margin rising by 9 basis points, and net interest income increasing by 8% from the first quarter to $1.1 billion. Also encouraging, KEY continued to gain market share and is seeing positive operating leverage due to increased corporate and bank-level efficiencies. Net charge-offs also remained low, at just 16 basis points. Headwinds include average deposits declining by 1.8% from Q1, but I'm not concerned, as this reflects seasonal commercial outflows and public sector deposit outflows related to stimulus funds. It's also worth noting that KeyCorp, like most banks, lacks an economic moat, especially considering its fragmented branch footprint which makes it harder to gain efficient scale. Nonetheless, I see management positioning the company for growth, as it recently acquired GradFin, a leading loan counselor for healthcare professionals. KEY also expanded its embedded banking platform which added new payments facilitation capabilities. Management is also aggressively targeting loan growth this year in the 9-11% range, and explained how it expects to achieve this goal during the Q&A session of the recent conference call: Q: So looking at the updated guidance and specifically I’m looking at the 9% to 11% loan growth and 1% to 3% decline in deposits, which is a pretty wide mismatch, how do you plan to fund loan growth beyond 2022? And at what loan-to-deposit ratio do you need to start fully funding loan growth one for one with deposits? A: As far as the loan growth, you’re right, the updated guidance is 9% to 11%. Deposits are expected to be up 1% to 3% year-over-year. That implies relatively stable deposits through the rest of the year. We do have some investment security maturities. We also will tap the wholesale market as far as funding that one of the benefits of originating residential real estate loans adds to our capacity as far as borrowing at the home loan and we can do that in a cost-effective way. Loan-to-deposit ratios were currently below 80% on our balance sheet. Typically, we would target between 90% and 95% loan-to-deposit ratio. So we’ve got plenty of room to work through that. I would say that we will continue to monitor this. But as Chris has highlighted a couple of times, we want to support our customers. And in these markets, we are going to see more customer demand for loans than we are probably going to see for capital markets opportunities.

Jul 20

KeyCorp Q2 2022 Earnings Preview

KeyCorp (NYSE:KEY) is scheduled to announce Q2 earnings results on Thursday, July 21st, before market open. The consensus EPS Estimate is $0.52 (-27.8% Y/Y) and the consensus Revenue Estimate is $1.76B (-0.6% Y/Y). Over the last 2 years, KEY has beaten EPS estimates 63% of the time and has beaten revenue estimates 50% of the time. Over the last 3 months, EPS estimates have seen 3 upward revisions and 9 downward. Revenue estimates have seen 1 upward revision and 6 downward.

Shareholder Returns

KEYUS BanksUS Market
7D8.3%5.5%1.3%
1Y-7.8%-13.2%-11.7%

Return vs Industry: KEY exceeded the US Banks industry which returned -14.5% over the past year.

Return vs Market: KEY exceeded the US Market which returned -11.6% over the past year.

Price Volatility

Is KEY's price volatile compared to industry and market?
KEY volatility
KEY Average Weekly Movement4.6%
Banks Industry Average Movement3.7%
Market Average Movement7.8%
10% most volatile stocks in US Market16.9%
10% least volatile stocks in US Market3.2%

Stable Share Price: KEY is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: KEY's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
184917,262Chris Gormanhttps://www.key.com

KeyCorp operates as the holding company for KeyBank National Association that provides various retail and commercial banking products and services in the United States. It operates in two segments, Consumer Bank and Commercial Bank. The company offers various deposits, investment products and services; and personal finance and financial wellness, student loan refinancing, mortgage and home equity, lending, credit card, treasury, business advisory, wealth management, asset management, investment, cash management, portfolio management, and trust and related services to individuals and small and medium-sized businesses.

KeyCorp Fundamentals Summary

How do KeyCorp's earnings and revenue compare to its market cap?
KEY fundamental statistics
Market CapUS$17.92b
Earnings (TTM)US$2.14b
Revenue (TTM)US$7.21b

8.4x

P/E Ratio

1.4x

P/B Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
KEY income statement (TTM)
RevenueUS$7.21b
Cost of RevenueUS$0
Gross ProfitUS$7.21b
Other ExpensesUS$5.06b
EarningsUS$2.14b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

Oct 20, 2022

Earnings per share (EPS)2.30
Gross Margin100.00%
Net Profit Margin29.72%
Debt/Equity Ratio163.5%

How did KEY perform over the long term?

See historical performance and comparison

Dividends

4.1%

Current Dividend Yield

33%

Payout Ratio

Does KEY pay a reliable dividends?

See KEY dividend history and benchmarks
When do you need to buy KEY by to receive an upcoming dividend?
KeyCorp dividend dates
Ex Dividend DateAug 29 2022
Dividend Pay DateSep 15 2022
Days until Ex dividend17 days
Days until Dividend pay date34 days

Does KEY pay a reliable dividends?

See KEY dividend history and benchmarks
We’ve recently updated our valuation analysis.

Valuation

Is KEY undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for KEY?

Other financial metrics that can be useful for relative valuation.

KEY key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenuen/a
Enterprise Value/EBITDAn/a
PEG Ratio2.4x

Price to Earnings Ratio vs Peers

How does KEY's PE Ratio compare to its peers?

KEY PE Ratio vs Peers
The above table shows the PE ratio for KEY vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average12.9x
CFG Citizens Financial Group
11.3x8.1%US$19.5b
RF Regions Financial
10x1.7%US$21.2b
HBAN Huntington Bancshares
12.4x2.2%US$20.5b
FCNC.A First Citizens BancShares
17.9x18.5%US$13.1b
KEY KeyCorp
8.4x3.4%US$17.9b

Price-To-Earnings vs Peers: KEY is good value based on its Price-To-Earnings Ratio (8.4x) compared to the peer average (12.9x).


Price to Earnings Ratio vs Industry

How does KEY's PE Ratio compare vs other companies in the US Banks Industry?

Price-To-Earnings vs Industry: KEY is good value based on its Price-To-Earnings Ratio (8.4x) compared to the US Banks industry average (9.9x)


Price to Earnings Ratio vs Fair Ratio

What is KEY's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

KEY PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio8.4x
Fair PE Ratio13.5x

Price-To-Earnings vs Fair Ratio: KEY is good value based on its Price-To-Earnings Ratio (8.4x) compared to the estimated Fair Price-To-Earnings Ratio (13.5x).


Share Price vs Fair Value

What is the Fair Price of KEY when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: KEY ($19.21) is trading below our estimate of fair value ($42.59)

Significantly Below Fair Value: KEY is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.


Discover undervalued companies

Future Growth

How is KeyCorp forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


3.4%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: KEY's forecast earnings growth (3.4% per year) is above the savings rate (1.9%).

Earnings vs Market: KEY's earnings (3.4% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: KEY's earnings are forecast to grow, but not significantly.

Revenue vs Market: KEY's revenue (3.5% per year) is forecast to grow slower than the US market (8% per year).

High Growth Revenue: KEY's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: KEY's Return on Equity is forecast to be low in 3 years time (13%).


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Past Performance

How has KeyCorp performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


12.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: KEY has high quality earnings.

Growing Profit Margin: KEY's current net profit margins (29.7%) are lower than last year (31.2%).


Past Earnings Growth Analysis

Earnings Trend: KEY's earnings have grown by 12.3% per year over the past 5 years.

Accelerating Growth: KEY's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: KEY had negative earnings growth (-4.2%) over the past year, making it difficult to compare to the Banks industry average (8.8%).


Return on Equity

High ROE: KEY's Return on Equity (15.6%) is considered low.


Discover strong past performing companies

Financial Health

How is KeyCorp's financial position? (This company is analysed differently as a bank or financial institution)

Financial Health Score

6/6

Financial Health Score 6/6

  • Asset Level

  • Allowance for Bad Loans

  • Low Risk Liabilities

  • Loan Level

  • Low Risk Deposits

  • Level of Bad Loans

Financial Position Analysis


Debt to Equity History and Analysis


Balance Sheet


Financial Institutions Analysis

Asset Level: KEY's Assets to Equity ratio (13x) is moderate.

Allowance for Bad Loans: KEY has a sufficient allowance for bad loans (242%).

Low Risk Liabilities: 85% of KEY's liabilities are made up of primarily low risk sources of funding.

Loan Level: KEY has an appropriate level of Loans to Assets ratio (60%).

Low Risk Deposits: KEY's Loans to Deposits ratio (76%) is appropriate.

Level of Bad Loans: KEY has an appropriate level of bad loans (0.4%).


Discover healthy companies

Dividend

What is KeyCorp current dividend yield, its reliability and sustainability?

Dividend Score

6/6

Dividend Score 6/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Future Dividend Coverage


4.06%

Current Dividend Yield

Upcoming Dividend Payment

TodayAug 12 2022Ex Dividend DateAug 29 2022Dividend Pay DateSep 15 202217 days from Ex DividendBuy in the next 17 days to receive the upcoming dividend

Dividend Yield vs Market

Notable Dividend: KEY's dividend (4.06%) is higher than the bottom 25% of dividend payers in the US market (1.5%).

High Dividend: KEY's dividend (4.06%) is in the top 25% of dividend payers in the US market (4.05%)


Stability and Growth of Payments

Stable Dividend: KEY's dividends per share have been stable in the past 10 years.

Growing Dividend: KEY's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (33.4%), KEY's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: KEY's dividends in 3 years are forecast to be well covered by earnings (37.9% payout ratio).


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

7.3yrs

Average management tenure


CEO

Chris Gorman (61 yo)

2.92yrs

Tenure

US$8,653,484

Compensation

Mr. Christopher Marrott Gorman, also known as Chris, has been Chairman and Chief Executive Officer at KeyCorp since May 01, 2020 and serves as its Director since September 19, 2019. He served as its Chief...


CEO Compensation Analysis

Compensation vs Market: Chris's total compensation ($USD8.65M) is below average for companies of similar size in the US market ($USD12.88M).

Compensation vs Earnings: Chris's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

Experienced Management: KEY's management team is seasoned and experienced (7.3 years average tenure).


Board Members

Experienced Board: KEY's board of directors are considered experienced (9.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

KeyCorp's employee growth, exchange listings and data sources


Key Information

  • Name: KeyCorp
  • Ticker: KEY
  • Exchange: NYSE
  • Founded: 1849
  • Industry: Regional Banks
  • Sector: Banks
  • Implied Market Cap: US$17.916b
  • Shares outstanding: 932.66m
  • Website: https://www.key.com

Number of Employees


Location

  • KeyCorp
  • 127 Public Square
  • Cleveland
  • Ohio
  • 44114-1306
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/11 00:00
End of Day Share Price2022/08/11 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.